Why China's Military Spending May Not Be That Impressive

Posted by Greg Scoblete at 9:07 AM

This week China announced it would up its defense tab by 10 percent. While this may have been music to ears of America's military-industrial complex, the reality is more complicated and considerably less menacing.

First, as a report in the China Quarterly notes, inflation has eaten away at the real-world impacts of China's big defense spending increases, making them much lower than current figures suggest. The military is also receiving a declining percentage of Chinese government spending -- "it does not come close to dominating national priorities," the study's authors write.

Indeed, as Lily Kuo observed, China is actually spending more money on domestic, internal security than it is on its external defense forces. The Communist Party has 1.3 billion people to keep an eye on -- a "near enemy" that's considerably more dangerous to their rule than America's Pacific fleet.